I have Windows XP Professional OEM key on the sticker on the computer, but I don't have a OEM media to perform reinstall. I could obtain (it doesn't matter how) an installation ISO images from MSDN site, but as I understand these are only images for Retail and Volume Licencing versions. So, can I use Retail (or VL) media to perform install and activate with OEM licence key?
You will need the standardized OEM install CD. It will work with all OEM keys. It does required a phone call to activate the install however. The CD has the normal holograms but also has the text "For distribution with a new PC only. The Certificate of Authenticity label should be attached to your PC. For product support, contact the manufacturer of your PC." on it.
I don't think it's available from MSDN so you have to ask friends or others at work if they have such a CD. Checking for the text makes it easy to tell a retail Windows XP disc from the standardized OEM one.
From my understanding,
OEM license only allows the copy to be activated and used on one, single, specific set of hardware it was sold for (and usually with). It can be reinstalled and reacticated as often as you like, but only on that machine. There is no way to move an OEM license to a different machine than the one for which it was sold.
A retail license can be moved from machine to machine, as long as it’s only ever on one machine at a time.